Ethereum Foundationa non-profit organization supporting the Ethereum ecosystem, recently moved a a significant amount of ETH. Given what this transaction could mean, it has caught the attention of the crypto community, which is already speculating whether the market may be at a high.
The Ethereum Foundation transfers 1,000 ETH
SpotOnChain on-chain analytical platform revealed on X (formerly Twitter) post that the Ethereum Foundation transferred 1,000 ETH ($3 million) to the middle multi-signature wallet (0xbc9) on May 8. This situation is even more disturbing since SpotOnChain revealed that the Foundation has carried out other transactions since the beginning of 2024.
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According to the platform, Ethereum Foundation sold 1,766 ETH for 4.81 million DAI at an average price of $2,725 for each ETH. These transactions are said to have occurred “in several small batches via the same multi-signature wallet.” Interestingly, SpotOnChain noted that these trades often occur before prices drop.
It is worth mentioning that the Ethereum Foundation already has a reputation for selling at the peak, which suggests that their selling before the decline may not be accidental. In 2022, NewsBTC reported that Ethereum fell by 40% after the Foundation sold 20,000 ETH. Meanwhile, in 2021, ETH experienced a downtrend for several months after the organization sold 35,000 ETH.
ETH’s price action after the Ethereum Foundation sold 20,000 ETH in 2022 | Source: Tradingview.com
Journalist Colin Wu too revealed then this Ethereum founder, Vitalik Buterin, convinced the foundation to “sell 70,000 ETH in early 2018 to support the work of developers.” Wu further stated that the Foundation’s sell-off is “normal operation, but it also means that the Foundation thought a bear market was coming.”
Therefore, from Wu’s revelations, it can be concluded that the Ethereum Foundation may have an idea when the market is at its peak, prompting it to always make these sales before ETH makes significant decline.
An ETH decline may already be perceptible on the horizon
Cryptocurrency analyst most recently known as Shin Forex predicted that Ethereum may soon fall to as low as $2,500. The analyst explained that there has been a slowdown in the flow of liquidity into the Ethereum ecosystem. This may have an impact on the price of ETH, as it suggests a lack of interest in the token among investors.
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From a technical analysis point of view, Shin Forex also revealed that ETH/BTC pair fell below the support at 0.05. Ethereum is said to have experienced a major outage when this happened in market cycles in 2016 and 2019. Therefore, the analyst has no doubt that ETH will probably start falling again, and the cryptocurrency will fall to just $2,500.
As of this writing, Ethereum is trading at around $3,000, according to data data from CoinMarketCap.
ETH price looking to establish support above $3,000 | Source: ETHUSD on Tradingview.com
Featured image from The Motley Fool, chart from Tradingview.com
